NALL Working Paper # 63

IN PRESS
Accepted for publication in the French Journal
Systemes d'Information et Management
Special issue on project management Spring
2001

ERP Systems as Facilitating

And

Confounding factors in Corporate Mergers:

the case of two Canadian telecommunications companies

Duane Truex

Associate Professor, Georgia State University, U.S.A. ;

Leverhulme Fellow, The University of Salford, England, and
Visiting Research Professor, University of Aalborg, Denmark

the
Le Rseau de recherche sur
research network for New
les nouvelles approches de
Approaches to Lifelong
l'ducation permanente
Learning

Abstract: This paper presents early findings from a research project in which the research partners,
academics and a telecommunication labour union, are attempting to understand, learn from and
anticipate further changes related to the implementation of ERP in an industry sector in the midst of
consolidation via corporate merger enabled in part by the adoption of ERP systems in the merging
partners.
NALL Working Paper # 62 ERP Systems as Facilitating And Confounding factors in corporate
mergers: the case of two Canadian telecommunications companies 2

I. INTRODUCTION

This paper describes an ongoing action research project initiated to assess the impact of the
introduction of an enterprise resource planning system (SAP R3) in a single Canadian
telecommunications company, BCTel (British Columbia Telephone Company). In the midst of the
research program it was announced BCTel would merge with another Canadian telecommunications
company, TELUS, of Alberta. This development, while not surprising given predicted consolidation in
the world telecom markets, is interesting given that both companies had each recently adopted SAP
R3 using similar reference models and system components, albeit ones implemented quite differently
at each company. The merger appeared to give further credence to the prediction that the use of
common reference models and ERP systems would remove significant barriers to organizational
integration and spawn industry consolidation. Thus it was expected that the integration of both
companies would be relatively unproblematic with the presence of a common ERP assuring the
subsequent success of the merger. A merger of Canada's second and third largest telephone companies
was expected to create a western Canadian powerhouse with $4.8 billion in revenue, $9 billion in
assets making it the second largest telecommunications company in Canada. A merger between BC
Telecom and Telus was the most significant adjustment in Canada's regional telecom providers since
the early 1900s when Bell Canada sold its stakes in Canada's three Prairie-based phone companies.
The merger was thought to be able to save the combined companies $178 Million in operating costs.
While the research is ongoing and, as of this writing the jury is still out as to the ultimate success of
the corporate merger, it appears that the presence of SAP at both organizations has, contrary to
expectations, presented significant problems for each organization. Moreover, the anticipated ease of
transition arising from the shared use of ERP systems did not materialize as expected. One unique
aspect of the project is that the research partner is the labour union representing workers at BCTel, the
Telecommunications Workers Union (TWU). As a result of the merger the TWU found itself engaged
in a certification election against the opposing union from TELUS, the International Brotherhood of
Electrical Workers (IBEW). It won the election and currently represents all of the 17,000 unionized
workers in the new company making it one of the twenty largest unions in Canada. Thus the study is
occurring in a surprisingly dynamic and interesting context. Preliminary findings and lessons gleaned
from working in such a dynamic research setting will be shared during the paper presentation.
NALL Working Paper # 63 ERP Systems as Facilitating And Confounding factors in corporate
mergers: the case of two Canadian telecommunications companies 3

II. THE RESEARCH QUESTION

At one level this research seeks to understand the structural organizational and work process
changes to be faced by labour resulting from the adoption ERP systems. One expected outcome is for
union leadership to structure programs enabling workers to acquire and maintain skillsets appropriate
to the new work environment. A second and more difficult question is: do ERP systems, when
applied in highly dynamic organizational settings, lead to greater long-term stability. This study is
unusual in that the point of entry to the organization, and the action research partner providing that
access, is the Telecommunications Workers Union (TWU) of British Columbia. Research partnering
with labour has not figured significantly in IS research since the early 1990s. At that time one
Scandinavian ISD research stream examined jointly optimized union-management systems projects
following socio-technical development principles. To the author's knowledge no other ERP research
has engaged organized labour. Canadian labor unions are unique in North American settings as they
have a more protected status than do the unions in the USA. And the TWU is unique among Canadian
telecommunication unions, as there is language in the collective bargaining agreement that guarantees
protections when technological change might have an adverse impact on its membership. The union
was established in 1949 and has an unusual position in the telecommunications industry in that it
represents bargaining units of technical personnel who are typically seen as managerial or exempt
workers in most other settings. Many of these provisions, though common in Northern European
collective agreements, are very unusual in North America. Hence this union has access to important
data resources and the interest to engage in action research project.

1. Current Research

There is a large, and growing stream of research on software system implementation (e.g., IS
Development methods and tools, GroupWare). And there are numerous consulting and technical
reports on ERP implementation. But published research studies on ERP projects still remain relatively
sparse. Most are concerned with the successful implementation of ERP and those exclusively from a
management centric viewpoint [1], [2]. Many are case studies of such successful implementation
which try to extract principles for success in configuration or process reengineering. [3], [4], [5]. A
few studies examine the impact on workforce size or the perceived success or failure of the
implementation [6], [7], [8], [9]. Studies exploring organizational change are largely descriptive
reports of organizational restructuring and headcount reductions at selected SAP implementation sites
[10], [11], [7]. Occasionally an article examines the issue of the 'fit' of the ERP to the organization
[20]. But, in general, the literature views success in a limited fashion, that is, these articles do not
study larger aspects of organizational and institutional change coinciding with the implementation of
ERP systems.

B. The Importance of the Research Question

The adoption of enterprise resource planning software (ERP) systems is one of the most important
software implementation events of the past thirty years. When successfully implemented in a near
majority of firms in an industry, these tools have the potential of reshaping whole industries and
supporting a consolidation and concentration on an unprecedented scale. They are reshaping the way
software is built and reshaping the basic social power structures in whole industries. The dominant
player in the ERP market is SAP (Systeme, Anwendungen, Produckte in der Datenverarbeitung,or in
English, Systems, Applications and Products for data processing). In a market with six primary
players SAP holds greater than a 66% market share and has more than 14,500 installed sites
worldwide.
NALL Working Paper # 63 ERP Systems as Facilitating And Confounding factors in corporate
mergers: the case of two Canadian telecommunications companies 4

1. ERP Costs. In the U.S. ERP sales grew from under $1 billion in 1993 to more than $8 billion in
1998, the time of the SAP implementation at BCTel. For an implementing company the software
purchase cost is but the tip of the iceberg; total systems integration is 8-10 times the cost of the initial
software price and they will typically spend 15-20% of the purchase cost annually to keep the ERP
system up to date. In the US companies spent $80 billion on integration projects alone in 1998. ERP
system sales are expected to grow to at a 37% compounded rate to $52 billion worldwide within the
next five years. This growth has resulted in an estimated 50 openings for every trained ERP systems
integrator with average salaries for personnel with 2 years of experience topping $130k plus on-time
completion bonuses.

Why are companies willing to incur such costs? Simply put, when implementation is successful,
firms are reporting returns on investment ranging from 30-300% because ERP is business process
infrastructure totally integrated in software. ERP systems are software mirror images of major
organizational processes such as customer order fulfillment and manufacturing. These systems
automate and integrate basic organizational processes from finance to the shop floor and eliminate
complex and redundant legacy software systems that were never designed to talk to one another.
When properly integrated and functional, ERP systems promise to deliver streamlined enterprise-wide
business processes, information and data management. And, as ERP systems are built on 'best practice'
industry reference models, they promise a reasonable degree of process competitiveness while
providing the opportunity for inter-organizational collaboration and intra-organizational data sharing.

2. Organizational Implications. Some implications of this development are quickly becoming

apparent. For instance, these organizations have fewer technical barriers to the integration of multiple
work processes that can be out-sourced to less expensive labor markets anywhere in the world. In one
instance at BCTel five previously independent jobsorder taking, credit checking, repair servicing,
checking of available inventory, scheduling of installation or servicecan now be performed by a
single worker while on the telephone and while working at a computer terminal. This employee can
service any orders from anywhere in the world as long as s/he is on the system. Thus types of work
become transparent to the customer and wholly virtual; i.e. unconstrained by location and removed
from specific geographic, cultural, political or institutional settings. Such developments increase the
potential for industrial globalization and consolidation.
Other changes may appear less apparent at first glance. For example, ERP software has an impact
on the way systems are built and introduced into organizations. Whereas, in the past, the prime goal
of a software development project has been to fit the shoe to the customer's foot, with ERP the
customer is forced to reshape his foot to the ERP shoe. Organizations are redesigning work processes,
discarding old practices organizational structures and legacy systems to fit the demands of the ERP
master. Furthermore, because ERP systems allow for the capture of virtually any type of information
at the point of entry, and then make it available to any process or authorized person in very powerful
ways, these technical exigencies now have the potential to generate enormous social change. For
instance, having data both available and useable allows for sophisticated data mining and business
knowledge discovery. With its end-to-end data sharing it provides access to many powerful analytical
tools and models for supply chain analysis, logistics and production planning and supports the ability
to monitor organizational processes at any degree of detail a manager might like. The work of
functional management specialists is now performed in software, making much of management a
virtual process. The result is an enormous concentration of power in top management. Those with
access to the data are empowered. Those without access will be marginalized.

ERP requires changes in management decision structures, evaluation and measurement systems.
These changes in turn affect organization authority, role responsibilities, job structures, and incentive
NALL Working Paper # 63 ERP Systems as Facilitating And Confounding factors in corporate
mergers: the case of two Canadian telecommunications companies 5

schemes. This affects organizational culture, values, beliefs as well as modes of thinking about, and
solving problems. The sheer scale and complexity of organizational and technology change suggested
by SAP is unprecedented in the history of Information Technology [13].

3. Wider consequences: ease of merger? An historical barrier to merger in industries heavily

dependent on information technologies has been the incompatibility of organizational systems and the
near impossibility to integrate incompatible enterprise data models. SAP greatly alters an industry's
environmental landscape because it removes a significant barrier to integration. It becomes much
easier to integrate operations of two large telecommunications companies when the workflow,
process, and most importantly, the data models are the same in both organizations. We may see such
consequences with the merger of the GTE-owned BCTel and Telus of Alberta. Both firms were SAP
users, each had 'gone live' just months prior to the public announcement that merger talks were under
way in October 1998. Moreover GTE and its other subsidiary telecom organizations are SAP users.
In August 2000 Telus purchased, the cellular company Clearnet, a user of SAP version 4.0. A further
consolidation with the Prairie (Manitoba and Saskatchewan) phone companies is reported to be under
consideration. The consolidation trend is being discussed by the professional community of ERP
integrators and users under the guise of Industrial Resource Planning systems [12]. In such a discourse
the company becomes nearly irrelevant because there are no longer barriers to end-to-end data
sharing. Hence it becomes interesting to study and document the joining of firms which were each
ERP users prior to the merger. Does having an installed ERP impede or facilitate the process?

III. METHODOLOGICAL APPROACH

A. Data collection

This project is an example of Action research which began mid 1998 and continues as of this
writing. In May 1998 the author and co-researcher, Ojelanki Ngwenyama, of Virginia Commonwealth
University, were invited to help the Executive Committee of the British Columbia
Telecommunications Workers Union understand the nature of ERP and to summarize the experience
on SAP implementation as reported in the academic literature. This led to our acquiring a complete set
of documents covering the proposed system and change that had been provided by BCTel
management. We were asked to provide an independent assessment, and were subsequently invited to
study the transition at BCTel. Thus began an unprecedented opportunity to study an ERP
implementation from the bottom-up and from within the ranks of labor. For example, we had access to
key documents and personnel and the opportunity to be participant observers in meetings which dealt
with the consequences of the implementation process. This afforded the opportunity for participant
observation in numerous union decision-making forums. In short it has provided access to the types
of organizational texts and perspective that is simply not typical of implementation studies.

Our relationship with the TWU allowed us to monitor and study ongoing developments in the
merger. The researchers have, with study team members drawn from the union leadership, have jointly
developed research protocols and structured interview questionnaires. Those were used to conduct
intensive two-hour interviews with labor and management users, and implementers of both pre-ERP
and post-ERP systems. Interviews continue as developments unfold. The project is thus consistent
with classical action research. One organizational learning goal was to train members of the TWU
study team so they could conduct the ongoing interviews. Accordingly, interviews were conducted by
members of the action research team, typically with one of the academic researchers present and
involved. But the presence of the academic was not always required since members of the project
team were trained and participated in all interviews. All interviews are being tape-recorded. The tape
NALL Working Paper # 63 ERP Systems as Facilitating And Confounding factors in corporate
mergers: the case of two Canadian telecommunications companies 6

recordings, field notes, and meeting minutes and drawings are being transcribed for analysis. The
researchers have pledged to stay with the process until a mutually determined conclusion. Interviews
are now expected to continue though 2001.

3. Data Analysis

The mixed character of the data requires several approaches to the analysis process. Archival
documents and meeting minutes were examined using discourse analysis and served to shape the
questions used in the interviews as well as provide contextual background data for the study.
Additionally, we have begun a critical deconstruction of company documents, made available to the
union. Interview texts and notes are being content coded using a textual analysis software tool, Hyper
Research, and are analyzed for structural themes and patterns. These analysis techniques are now well
accepted in our research community and have been successfully used in work in print, in press and
under review [14], [15], [16], 17], [18].

IV. PRELIMINARY FINDINGS

As our research partner is the TWU it is not a surprise that one of the goals of the work is to learn and
be able to anticipate the impact the changes wrought by SAP and the merger will have on the union
workers. Knowing and ultimately predicting likely events will allow the union to frame training and
bargaining responses to use in protecting and preparing its membership for a future changed by the
technology. The early and exploratory interviews suggested that the SAP transition was having
impact on four areas: 1) job loss and transition; 2) unanticipated organizational changes; 3) structural
change in work; and 4) decision-making. While the first three topics may be self-evident the last
needs a bit of explanation. The interviews we conducted suggest an altogether different view of how
work is accomplished and how day-to-day decisions are made in the provision of telephone service.
We were surprised to find that major decisions, often involving very significant sums, were regularly
made by non-management bargaining unit (union) employees. Hence, it became a point of interest to
see how the introduction of ERP and it concomitant work process reengineering would impact
authority, decision making and the organization of work. Thus the four areas listed above became
themes to be explored in subsequent interviews and provided a framework for the ongoing analysis.
From this material we excerpt several key points for discussion below.

A. Primary reasons for the move to ERP

The reasons given for early moves to ERP systems centered on the desire to consolidate processes
and achieve competitive advantage via the best of practice industry reference model available in the
ERP system. From our interviews we learned that the Y2K concern became the primary argument that
BCTel management used to gain support for their SAP acquisition decision. Interoperability of
system components and of shared data were also strong motivators, as was the planned savings to be
realized in head-count reductions. However, by early 1998 Y2K fears began driving the ERP
implementation. These points are made in the following excerpt from one interview.

DT: OK, Im very interested in this, Im guessing as we hear themes that the Y2K was one big one.
M1: For us it would be the biggest because most of the systems that we had, some of them were 25
- 30 years old, and they were all written either in Cobol or they were written in other old
machine languages that definitely were not Y2K compliant, they were all into the 2 digit .
DT: So that was actually voiced as one of the primary [reasons]
NALL Working Paper # 63 ERP Systems as Facilitating And Confounding factors in corporate
mergers: the case of two Canadian telecommunications companies 7

M1: Absolutely, that was the selling point of SAP, because what youve got is how much money
do you spend to remodify home built systems, or do you take that to modify and make it Y2K
compliant, and then theres the odds and sods if you have to add to it, or do you get one thats
already built thats got that large footprint that can take those various pieces of information
and deal with it, maybe in a different way, and thats what happened to our business plan
within BCTEL because we had to adapt within the SAP framework.
DT: Ok, Year 2K would be [reason] one, the second would be
M1: Well, the second would be shared [data] access. And third would be more or less a continuity,
so that when you put in a project number or if you put in an invoice number, if you put in
1,2,3,4,5 and at the far end of the system where it may be the last time you see it its still
1,2,3,4,5 Well, the
second would be shared [data] access. And third would be more or less a continuity, so that
when you put in a project number or if you put in an invoice number, if you put in 1,2,3,4,5
and at the far end of the system where it may be the last time you see it its still 1,2,3,4,5

B. Impact on work force

Our early findings are consistent with other reports in the literature [5, 6], showing wholesale
elimination of job classes and functions, and increasing worker stress. At BCTel the financial
accounting and control functions were especially hard hit with reports of staff reductions ranging from
a low of 12.55 to 100% in some departments. The norm was better than 60% job elimination. The
turmoil appears to have been spread throughout the organization with departmental consolidation and
other structural changes. The stress of change and of job reductions is being shared throughout rank
and file and management. Those departments hit early were charitably spared the worry associated
with not knowing what to expect. Interview after interview revealed that the stress of dealing with a
shrinking workforce, increased workload and with having 'the Sword of Damocles hanging over ones
head' was having a detrimental impact on employee morale and productivity. One manager we
interviewed expresses it as follows:

M1: So I think theres going to be a huge transition, some people will be impacted only in the
respect that their lives will be put in turmoil for quite awhile as they go through this. At the
end of it, if its successful and should it be successful, it has to be successful in order for the
new company to be competitive, The business plans always state that, they say when we
implement it SAP, that there was always a head count associated within [some period] of a
fairly radical new process, because of the work that changed. You suddenly no longer need
that support, you suddenly maybe even in the middle management side, dont need the
staffing required that was there to support the various systems that were there before, I mean
this is one of the sound points of SAP. Not only does it cost you $56 million, but when you
can your $56,000 by laying off or firing 28 managers and 15 clerical, or whatever, theres an
offset. I dont think [release]4.6 or 4.5 is going to make any more of an impact on what
weve got right now.

Moreover the workload was increasing for those who did survive the cuts. We continue to be told
that the increase in workload is not necessarily offset by improved system support.
JP: [before SAP] 9 of us support 30 sales people where now 5 support 80 salesmen
NALL Working Paper # 63 ERP Systems as Facilitating And Confounding factors in corporate
mergers: the case of two Canadian telecommunications companies 8

C. Implementation Issues

The implementation of SAP was unlike any other previous systems implementation at BCTel. In
previous large-scale development projects management had assembled project teams of bargaining
unit personnel (union members covered by the union contract), management and IS staff to be
involved in the whole range of requirement identification through implementation, training and
evaluation lifecycle activities. As a result interviewees reported that legacy systems were well liked
and served their intended purposes very well. Moreover people reported that the process of systems-
organization integration in the past had been relatively smooth and unproblematic. The SAP project
stands in sharp contrast to the systems development activities of the past. In the transition to SAP R3,
bargaining unit personnel were precluded from early participation. Indeed, more than 15 months of
planning and preparation by management and SAP consultants had been completed before the union
was informed of the intended transition to SAP. Although there is a legal requirement for management
to provide adequate notice of technology change so that the union can plan for retraining and
transitioning those of its affected members, they were not notified until only four months prior to the
going-live date of the SAP system. The results of this management action are the subject of
considerable interest and will be more fully explored in later work. However for the purposes of this
paper it is important to note that management ultimately found it necessary to turn to the very persons
excluded from pre-implementation activities to sort out and make the delivered system configuration
viable. In the weeks following the go-live date normal work ceased. SAP as implemented in many
areas was radically different from previous systems and way of thinking about the work at hand.
What little training had been offered workers was of little use for two reasons. First, it simply was not
very good. We had many examples of how trainers could not answer basic questions about the system
use and how pieces related one to another. It soon became clear that the configuration was not up to
par and that consultant and management trainers knew neither the work processes nor the system well
enough. Second, the training as offered was during the workday with it normal demands and
interruptions and in many cases was given long before workers had the opportunity to connect and
actually use the system. Thus the material provided in training was lost as it could not be immediately
applied or because system elements had changed. The apparent corporate strategy to exclude user
communities from the configuration community and to rely instead on management only had
backfired. As a result in a number of instances users were left to fend for themselves and learn largely
by trial and error. This had a very interesting consequence. A number of users began to master system
use and some began to record the procedures they followed in so learning and using the system. As
word spread in bargaining unit circles other workers began to call and email the more adept workers
and ask for instructions and assistance. Eventually management learned of these people and in two
instances tapped them to create users manuals for general distribution on company intranets and the
like. We interviewed three of these people. Management identified and recruited these persons without
telling them that their particular job classes had been targeted for elimination. Once the task was
completed these people were made redundant. This provides but one illustration how the SAP
implementation is much more instrumental in its approach to the worker/user community and less
sensitive to organizational surroundings and culture than had been past practice. As of this writing
numerous subsystems remain in disarray and even so the newly merged organization is not moving to
update to R4.6 and move to a common SAP footprint for the new organization.

D. Integration issues: difficulties despite being SAP R3 users

Both BCTel and TELUS continue to face significant and traumatic transitions since the merger. For
BCTel, these began with the move from well-liked legacy systems to a major SAP implementation
that went live in Mid-1998. The integration of the two companies (BCTel and TELUS) after the
NALL Working Paper # 63 ERP Systems as Facilitating And Confounding factors in corporate
mergers: the case of two Canadian telecommunications companies 9

formal merger necessitated a consolidated SAP implementation in order to integrate the data and work
processes of both organizations. To bring this about the management decided in 1999 that the BCTel
organization should upgrade to SAP release 4.6 to match TELUS. The implementation was expected
to have been completed in the first quarter of 2000. Nominally the transition to the integrated SAP
system in the British Columbia (BC) and Alberta (AB) operations happened in two stages following
preparatory upgrades to hardware and facilities were in place for the new combined operations.
Alberta moved to the new operational setting in March of 2000 at the same time they changed from
SAP V3.1 to V4.6d. BC made the first transition to the new integrated system with AB in June of
2000. However, as of this writing the combination of operational systems is not complete and is
actually remains in dispute. The current and historical data from BC were not brought into the new
system. For instance the former BC operations center continues to house the data warehousing. The
BC historical and 'actuals' data remains in an SAP v3.1 on the old operations complex. Respondents
report that there are many data conversion problems and describe the merger and the SAP integratio
project as a "work in progress." A central problem persists; namely, that the processes used by each
former provincial company are different.

Table 1 provides a summary of how reference modules were interpreted and used at BCTel and the
mapping of modules at each organization. This points out an interesting fact. Namely, while both
organizations were using SAP there were significant and unexpected differences in the particulars of
the implementation at each site. The BCTel approach was one they called the big footprint where a
set of modules were acquired and imposed on the organization. Business process reengineering was
accomplished in concurrence with and was driven by the software. The organization remains in the
midst of wrenching changes as it seeks to adapt its new processes and structures to the demands of the
software. In the instance of Telus the organization configured highly customized modules which more
closely matched the organizational culture and work procedures at Telus. The result for the newly
merged company was additional trauma. Each company had adopted SAP. It was therefore expected
that consolidation of process and data would be swift and relatively painless. But the significant
differences which existed in the procedures and corporate cultures of the two companies were
exacerbated by the residual of the differing cultures in the remaining legacy systems and in the
customized modules and the embedded cultural assumptions of the ERP itself.

Respondents report process integration problems as being territorial disputes.

"There remain "lots of turf fighting ('our process is better than yours'). Until someone makes the
decision to align the processes, there really isn't a common system." DG 2/15/01
Operational imbalances reflect the very different managerial and operational styles of the old partners.
For instance, as an artifact of the labor history and labor contract, in BC bargaining unit (union)
employees have higher levels of operational control and systems access and do their counterparts in
Alberta. As a result of the historical contract provisions it was more difficult for management to
replace unionized workers with access to the system by non-unionized or 'exempt' employees.
Interestingly this has meant that in BC there remain more employees working with the SAP system
who retain a sense of organizational operational history than in Alberta. The unionized employees
handle their side of the operation more efficiently than the newer nonunion management designated
hires. As it applies to the SAP integration, in BC two bargaining unit employees run the capital
budgeting system for BC whereas in Alberta around 20 'management professionals' (non union)
provide the same function for Alberta.
NALL Working Paper # 63 ERP Systems as Facilitating And Confounding factors in corporate
mergers: the case of two Canadian telecommunications companies 10

V. CONCLUSIONS

This paper reports on research in process. Indeed we expect to follow developments in these
organizations for some time to come. As such, preliminary findings reported above reflect a small
piece of a dynamic picture. By its very source the focus of this research differs from extant work on
ERP systems research. This work has caused us to reconsider traditional views of implementation
success from that of a management-centric view to one encompassing both the local narratives of
workforces and communities in transition because of a software system change. It has also caused us
to modify our conception of how easily ERP allows for integration of organizational data and
processes and presumptions that the merger of firms using similar ERP would guarantee smooth and
successful transitions. For instance, two benefits of ERP systems are suggested that may actually
work against successful integration of ERP systems and be an inhibiting element in corporate mergers.
One of the chief benefits of using industry reference models are taken to be that the implementing
organization can feel confident that it is using 'best of breed' work processes. Such implementations
have become quite common. Indeed, the SAP product ASAP was developed to help firms that choose
to adopt standard implementations of the software systems do so as easily as possible. Such
implementations provide a degree of standardization that it appears is thought to allow a relatively
painless integration of companies using SAP. But some companies who choose to take advantage of a
second important and lauded facility, that is the ability to highly customize the ERP to reflect a firm's
distinctiveness and cultural differences. Such was the case of Telus of Alberta before the merger. In
such instances the benefits of standardization are given up making the integration of multiple ERP
implementations far more problematic. Moreover, as was discovered at Telus, a move from a one full
software release to a higher version, particularly those involving architectural change, is not a trivial
transition.

Not all SAP initiatives have been successful. Examples of limited success and outright failure [7]
indicate that the means to correctly implement such software systems are not yet well understood.
This on-going research, as such it is limited in several ways. First the findings are descriptive of an
unfolding and dynamic set of events. Hence any report is going to present a image frozen in a time
which by the nature of events is out of date. It is a study that looks at organizational and institutional
issues, from the bottom up. It is not a view informed solely by managers, although some former
organizational managers were interviewed and provided valuable corroboration of our data. Rather it
is a view principally informed by the experiences and observations of engaged line workers some of
whom were elected to key representative positions within their labour union. Thus their view could be
expected to privilege human versus organizational goals. But it is also a view that places the impact
on whole communities above that of a single business organization. As such this is a refreshing and
unique and perhaps even holistic view of a major ERP implementation effecting the lives of hundreds
of thousands of customers and thousands of employees. Finally, because this is a study drawn from a
single site in a cultural, legal and political setting that is very different from that in the United States
and in Europe, its uniqueness makes it impossible to generalize to all ERP implementations.
However, given that the setting has elements similar to both American and European legal and cultural
conditions some lessons and cautionary notes may be gathered in examining the events as they unfold
in Western Canada. Ultimately it will be up to the reader to decide whether or not, if in examining the
impact on a competent and engaged professional, technical and blue-collar workforce, one may have
a better understanding of the ERP implementation process.
NALL Working Paper # 63 ERP Systems as Facilitating And Confounding factors in corporate
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Table 1: SAP Modules as used at two firms:

Modules in use by:

MODULE as used BCTel TELUS
Financials (FI) Accts.Paya A/P, A/R,
(accounting) ble; Accts A/M
All financials, Recble;
managerial and Accts.
financial statements Mng't;
Reconciliati
on
Controlling(CO) Clerical clerical
(overhead cost and
product cost)
All operating
budget by cost
center and work
center
Investment Capital C/M
Management (IM) mngt.
(Capital investment)
Capital structure
and capital
budgeting
Project System (PS) Networks: PM, Tech,
Project management techs, clerks Clerks
planning work and
resource allocation
budgets and
tracking plan
through
implementation
Work Flow (WF) Net OPS
Way of handing off
work to be done;
electronic
distribution; manage
signoff; managerial
function, do we
have the $$ and
people?
HR Human [PEOPLE
resources SOFT]
Training completed,
skill set tracking.
Currently
PeopleSoft provides
benefit tracking and
NALL Working Paper # 63 ERP Systems as Facilitating And Confounding factors in corporate
mergers: the case of two Canadian telecommunications companies 12

management
Plant Maintenance Tech Craft
(PM)
Maint. Of test
equipment, truck
maint., switches,
Sales and Dist. (SD) Clerks,
Salesman sells, sales, techs
generate warehouse
picks, billing and
charging, work
scheduling, PBX
orders
Materials [Catalyst]
Management (MM) plant,
Ordering, materials drivers,
stocking at clerks,
warehouse, pick buyers
tickets (Catalyst
used at BCTel)

ACKNOWLEDGEMENTS

This work was partially supported by the Georgia State University Robinson College of Business
research course release program, the Canadian NAAL (New Approaches to Lifelong Learning
foundation) and by the TWU (Telecommunications Workers Union) of British Columbia. An early
version of this paper was appeared in the European Conference of Information Systems,ECIS 2000
(Vienna), proceedings.
NALL Working Paper # 63 ERP Systems as Facilitating And Confounding factors in corporate
mergers: the case of two Canadian telecommunications companies 13

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